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News Link • Central Banks/Banking

The Central Bank Bubble's Bursting: It Will Be Ugly

• zerohedge.com by Alex Deluce

Central Banks over the last decade simply created credit out of thin air. Snap a finger, and credit magically appears. Only central banks can perform this type of credit magic. It's called printing money and they have gone on the record saying they are magic people. 

Increasing the money supply lowers interest rates, which makes it easier for banks to offer loans. Easy loans allow businesses to expand and provides consumers with more credit to buy goods and increase their debt. As a country's debt increases, its currency eventually debases, and the world is currently at historic global debt levels. 

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